On September 27, at the Ministry of Finance’s regular press conference for the third quarter, Mr. Dang Ngoc Minh, Deputy Director General of the General Department of Taxation, answered a question regarding the ban on foreign travel for businesses with tax debts.
According to Mr. Minh, the Law on Tax Administration stipulates temporary suspension of foreign travel for individuals and legal representatives of enterprises. This measure is just one of the many enforcement actions that tax authorities may take. In the case of a specific business representative being banned from foreign travel, the tax authorities will have previously applied multiple tax enforcement solutions against the enterprise.
“Individuals have a responsibility to fulfill their tax obligations. In the event of a specific individual being banned from foreign travel due to tax debts, the tax authorities will propose appropriate solutions to ensure compliance with the law,” said Mr. Minh.
The tax authorities proposed the temporary suspension of foreign travel for 2,411 cases of tax debt in 2023 and have temporarily suspended the foreign travel of more than 6,500 cases since the beginning of this year.
Deputy Minister Nguyen Duc Chi chaired the Ministry of Finance’s regular press conference.
At the press conference, Mr. Minh also answered a question regarding the proposal for e-commerce platforms to declare taxes on behalf of sellers. He stated that this proposal aims to improve tax administration efficiency. The Law on Tax Administration offers a solution involving coordination between ministries, enterprises, and e-commerce platforms in providing information to tax authorities.
“The provision of information by e-commerce platforms is already regulated. The proposal for these platforms to declare taxes on behalf of sellers aims to enhance tax administration effectiveness. So far, 108 foreign providers not present in Vietnam have declared on behalf of service providers. The proposal for domestic e-commerce platforms to declare taxes on behalf of sellers is to ensure fairness. If foreign providers can declare on behalf of their clients, why can’t domestic e-commerce platforms do the same?” Mr. Minh added.
Deputy Minister of Finance Nguyen Duc Chi stated that the development of e-commerce inevitably leads to changes in tax management methods. He acknowledged that implementing new proposals could be challenging and instructed the units under the Ministry of Finance to listen to the opinions of enterprises to choose effective and suitable solutions.
Previously, the Vietnam E-Commerce Association (Vecom) provided feedback on the draft Law on Amending and Supplementing the Law on Tax Administration. They proposed amending and supplementing Clause 4, Article 42 of the Law on Tax Administration to stipulate that e-commerce platforms are responsible for declaring and paying taxes on behalf of business households and individuals doing business on these platforms. They also suggested adding Clause 4a to Article 98 of the Law on Tax Administration to regulate that e-commerce platforms and logistics service providers are responsible for providing full and accurate information about the traders doing business on these platforms or using their logistics services.
Vecom recommended removing these two clauses as they contradict international practices. They argued that forcing e-commerce platforms to declare and pay taxes on behalf of business households and individuals doing business on their platforms is inconsistent with the provisions of Article 24 of the Law on Personal Income Tax.
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